Commodities Comment:5 factors that could turn met coal pricing around

A 3Q15 premium hard coking coal contract settlement of $93/t FOB Australiawas reported on Wednesday, down 15% QoQ and the lowest settlement since2004. Back then the market looked very different; it was only ~60% of the sizeit is today (105mt smaller), Chinese net imports were zero and contracts wereset annually. We had expected a settlement of $95/t, but extremely weakmarket sentiment meant that the final outcome represented a premium of just$3/t over the current spot price